Billing services currently exist to manage medical practices. These services relieve medical professionals of tedious detail work, but rarely do they offer a means to substantially maximize the practice's bottom line. Physicians 1st Billing and Claims will not only free office staff for more crucial tasks, but will also maximize return from insurance carriers.
National statistics show only about 70 percent of insurance claims, initially submitted on paper, are ever paid by insurance carriers. With electronic submission Physicians 1st Billing and Claims can increase the percentage of claims paid to around 98 percent.
Additional statistics indicate that it currently costs a medical practice between £8.00-£10.00 per claim to process insurance for their patients. Physicians 1st Billing and Claims can reduce these costs by 50 percent or more.
Statistics show turnaround on paper insurance claims to be 30, 60, even 90 days or longer, creating serious outstanding receivables for the practice. By submitting claims electronically, Physicians 1st Billing and Claims can generally have money in the physician's hand within 14-18 days. Of course, this reduces outstanding receivables proportionately and tremendously improves cash flow.
Statistics also show a 30 percent suspension/rejection rate for paper insurance claims. This doesn't mean that the claims are never paid. What it does mean is medical staff must hassle with insurance carriers over payment. With the extensive editing performed on electronic claims prior to their transmission to carriers, this percentage is reduced to 2-3 percent. Claims are submitted with a 98 percent accuracy rate.
For many years physicians graduated from medical school under the premise that they were going to run a "practice." "Businesses" were for other professionals. Many simple administrative procedures were neglected, such as:
Keeping current with insurance specifications and regulations, so that claims were paid on a timely basis,
Concentrating on collecting receivables and co-payments,
Ensuring that fees were kept at the maximum allowable insurance carriers were paying, or
Procedure codes were current so that claims weren't suspended or rejected.
For many offices, outstanding receivables grew tremendously and annual bad-debt write-offs became routine. But adequate profit margins allowed medical practices to ignore sound business procedures. Medical practice complacency toward industry change is in the past. Physicians' heads raised and they began taking note of public opinions toward health care reform issues four years ago. With the onslaught of managed care organizations into the industry, physicians are finding profit margins shrinking. They are now alert to the fact that in order to remain in business into the 21st century, they will have to adopt more efficient business practices. Physicians 1st Billing and Claims is prepared to assist local health care providers move through the last of the 20th century and into the 21st century with sound practices that will guarantee business success and, in turn, guarantee quality health care for our families and our country.
Physicians 1st Billing and Claims is contributing over £9,000 to this business. We are requesting to borrow another £5,000. Please give this detailed business plan your attention. The use of these funds is explained in the Start up Summary section.
To acquire one account by the end of month two.
To process 1,500 claims a month by month 15.
To become recognized as a local industry expert in the field of medical reimbursement.
To add several additional services to our initial offering of electronic claims submission, including:
Managed care contract analysis.
Full practice management.
Medicare financial impact analysis.
Physicians 1st Billing and Claims is a medical reimbursement consulting firm dedicated to helping medical practices become more efficient and save money by allowing them to out-source their insurance processing and medical billing to an expert reimbursement service. We intend to have complete one-stop-shopping for all medical practice administrative functions by the end of 1998. We intend to make enough profit to repay our business-start-up loan and finance continued growth and development with our quality service.
1.3 Keys to Success
Since 1985, the Federal Government has been urging the health care industry to submit insurance claims electronically. Statistics prove that electronic submission can save millions of dollars annually for the industry. Presently, 95 percent of all pharmaceutical claims and 70 percent of hospital claims are submitted electronically. Physicians and dentists trail far behind, with only 25-30 percent.
The Federal Government is not happy with this situation so in 1990, Congress mandated that physicians are required to file claims on behalf of all their Medicare patients. Many doctors were not prepared for this deluge of paperwork. Eight years later doctors are still climbing out from under the paperwork. In 1996 the motions calling for electronic submission of all Medicare claims were being echoed throughout the halls of congress. No mandate was passed but the paperwork continues to mount up and as baby boomers near retirement age the paper problem will only get worse and those echoes will turn into screams. This year in the U.S. over 1 trillion dollars worth of medical charges will be issued. This amounts to 9 billion medical claims. Medical practices will be forced to meet the mandates, and growing mountains of paper and most are not currently equipped to handle the transition. The sensible solution is to out-source the process to experts that are prepared to save the practices money, produce a much faster return from insurance carriers, and handle the claims with a high degree of accuracy. There aren't many businesses that can say the Federal Government is behind them all the way.
A second key to our success will be flexibility. Physicians 1st Billing and Claims understands that each medical practice is unique. Even practices of the same specialty will have different staff and offer different services. Physicians 1st Billing and Claims will evaluate the needs of each practice and offer solutions to help the practice become more efficient. Some may want all the services we offer and some may select only a few. Our billing will be customized to each office's needs.
A third key is our diversified services. Physicians 1st Billing and Claims offers a one-stop-shopping experience for medical administrative services.